Your security to being paid back is a second lien.

I already have experience managing properties and I’ve been learning a lot about renovations (I just can’t do most of the work right now due to the pregnancy), so I’m trying to find the best route for me now while also securing a little home for my little family.

I can bring capital to the deal, partners and then a combination of loans/hard money to secure the property and start the rehab.

Their security deposit is only $400 which doesn't even cover the cost to paint the whole unit. 

Real estate attorneys, closing attorneys, fair housing attorneys, and securities/syndication attorneys are all different.

Please, realize I am not giving Investment Advice regarding any specific Security or Securities. 

Am I as the buyer able to sue the owner of closing company/person who conducted title search due to fraud/negligence or do I only have a breach of warranty case against the previous seller (who is a master of setting up and dissolving LLCs to conduct similar high risk deals - unknown when transaction began)? 

If the investors are passive and have no active role you have a security and is regarded a syndication . 

She mentioned to me that items under the property to secure the foundation was not completed and began to tell me what was wrong.

Obviously that secures my house to the loan, but it would basically keep me from draining my savings account to throw in a 20% down payment.